41st Congress of the European Regional Science Association: "European Regional Development Issues in the New Millennium and their Impact on Economic Policy", 29 August - 1 September 2001, Zagreb, Croatia

Abstract:

This paper aims at uncovering and explaining regional patterns of private enterprise development during the transition to a market economy in Romania. Using available data at regional level, we find different regional patterns of entrepreneurship intensity for new private firms, self-employment and new firms with foreign private capital. Our empirical analysis suggests that home ownership, education, R & D knowledge spill - overs, railway density and potential cross-border traffic have a significant influence on the regional pattern of private enterprise development. Wage and unemployment may play a role as push-factors. Unemployment seems to be indeed a significant determinant of self-employment but not for the case of new private firms. Finally, after controlling for regional geographical characteristics, we find that geographical location matters for entrepreneurship intensity in the case of the north-west region and capital city.